3DRealms comments on closure, lawsuit
3DRealms issued a statement this week addressing it’s closure and offering a rebuttal to Take-Two Interactive’s lawsuit alleging breach of contract related to Duke Nukem Forever. The statement, at face value, sheds some light on just what rights the creators of Duke Nukem Forever hold. The first thing worth noting is that 3DRealms claims that the company has not closed, despite notes on the company’s official web site, insider information and multiple news reports.
“Despite rumors and statements to the contrary, 3D Realms (3DR) has not closed and is not closing,” the company said in a statement. “3DR retains ownership of the Duke Nukem franchise. Due to lack of funding, however, we are saddened to confirm that we let the Duke Nukem Forever (DNF) development team go on May 6th, while we regroup as a company. While 3DR is a much smaller studio now, we will continue to operate as a company and continue to license and co-create games based upon the Duke Nukem franchise.”
What the company will be able to accomplish without any funding, developers, a less-than-stellar public image and a pending lawsuit seeking $20 million in damages for “breach of contract,” is in serious doubt.
The company also attempted to set the record straight, putting forward its own set of facts about its relationship with Take-Two Interactive. According to the statement, Take-Two gave 3DRealms $2.5 million - but as part of a separate agreement for another game - in July 2008. If true, it proves that Take-Two has shown poor judgment considering 3DRealms’ decade long development of Duke Nukem Forever. That aside, 3DRealms claims that the last time it received money was from GT Interactive in 1998, amounting to about $400,000. While Take-Two may have signed some sort of deal with that publisher before it took a dirt nap, 3DRealms says that it was not privy to any details, nor was it a part of the deal.
Interestingly, 3DRealms may not hold the publishing rights at retail, but it does have the right to sell the game “directly” to consumer. We assume this means that it holds the digital distribution rights. what we do not know is whether or not this means the game can be sold elsewhere like on Steam, Direct2Drive, Impulse or Gamers Gate..
“As some of you may know, Take-Two filed a lawsuit last week containing various accusations and claims against 3DR and the uncompleted DNF game,” the company said. “Take-Two never paid 3DR advances or any signing bonus or any other funds related to DNF, up until July 2008, at which time they paid $2.5m in connection with another agreement for an unannounced game. This is the sum total Take-Two has paid 3DR in connection with DNF. Take-Two claims that they paid $12m to GT Interactive/Infogrames to acquire the publishing rights for the DNF game. To be clear, 3DR was not a party to that transaction and did not receive any money from it. When the DNF game was originally signed with GT Interactive in 1998, GT paid 3DR a $400,000 signing bonus. Up until July 2008, this was the only publisher money we received for the DNF game. Meanwhile, 3DR put over $20m into the production of DNF. ”
Finally, 3DRealms says that the reason for the closure of the studio - or at the very least - the layoff of the DNF development team, was due to a lack of funding. The company had been in negations with Take-Two but that fell through. 3DRealms also said that Take-Two tried to take ownership of the game and the team developing it but the terms of the contract were not acceptable. The company viewed the offer as a play to buy it cheap in a “fire sale.” The contract was also missing upfront money, a guaranteed minimum payment, and a guarantee to complete the DNF game.
3DRealms closed out its statement with a promise: to vigorously defend itself against the publisher. We’ll have more on this story as it continues to develop.
